Will Iran's Ahmadinejad Seize OPEC Platform?

Mahmoud Ahmadinejad could chair the June meeting of the Organisation of Petroleum Exporting Countries, giving the Iranian president a platform and an opportunity for the country to force a way out of its growing isolation.

AP

Mahmoud Ahmadinejad, president of Iran

Analysts warn that his presence at the meeting, and his ability to hijack the agenda, could mean that the event becomes a platform for Iran’s foreign policy, rather than a forum to resolve ongoing issues in the energy markets.

Iran holds the rotating presidency of OPEC, and Ahmadinejad is currently head of the country’s oil ministry after firing minister Masoud Mir-Kazemi on May 14.

It is possible that the president could nominate a representative or appoint a new minister between now and the June 8 meeting in Vienna. Privately, some analysts branded the report, fed through the semi-official Fars news agency, that Ahmadinejad would take the stage “a stunt.”

It is very rare for heads of state to preside over OPEC meetings which are largely dominated by technocrats.

However, others believe that Ahmadinejad may see this as an opportunity to re-establish his global profile at a time when he is facing enormous pressure from conservative forces at home. The president was censured by the country’s religious leadership for going through with a cabinet reshuffle without their approval.

Internationally, rifts between his country and its key ally Syria and the Islamist group Hamas’ reconciliation with Fatah, the Palestinian political party, have left Iran looking isolated.

In April, Hamas and Fatah, formerly bitter rivals in the Palestinian political process, agreed to form an interim government and a timetable for presidential elections – a move that is seen as diluting Iranian influence in the region. Iran has been a leading backer of Hamas.

Unrest in Syria directed against Iran’s ally, president Bashir Al-Assad, has also underlined the fragility of its regional alliances after the “Arab Spring” of popular revolutions.

The Iranian president may now seize a rare opportunity to inject himself into an association with global prominence, albeit one full of hostile members.

“He’s been very weakened over the last few months, and especially over the last few weeks, domestically in Iran. He was slapped down by the Supreme Leader,” IHS Global Insight analyst Sam Ciszuk told CNBC.com.

“He might be facing his toughest crisis so far. It’s definitely on par with the 2009 election aftermath, and hence he is likely – as he has done previously – to want to shift the attention from the domestic politics and sort of re-establish himself a bit in the foreign policy agenda. Essentially that has been his strategy since he became president."

“He’s making foreign policy noises in order to give him leverage at home.”

OPEC commands around 40 percent of the world oil markets and plays a major part in managing global supply. Typically the meeting is dominated by Saudi Arabia and its allies, and it is unlikely that Ahmadinejad will be able to genuinely alter the organisation’s policy, Ciszuk said.

“Ultimately it’s all about perception. He cannot really have any impact because he will not lead Saudi Arabia into more radical territory and Saudi Arabia’s allies, ultimately they dominate OPEC. He can’t scale back Iranian production or do anything outlandishly radical like that."

“As everybody knows, the reason for high oil prices are elsewhere right now, however… if the popular news outlets in the US suddenly might pick up the name Ahmadinejad and have that as a main blame for $4 per gallon gasoline, then he’s taken it pretty far and his own domestic propaganda machine will have enough to try to work with at home. Especially if he can provoke politicians in the west to start mentioning his name a bit more,” Ciszuk said.

Oil traders and analysts will be watching closely to see what stance Ahmadinejad takes, if he does make it to Vienna.

“[Ahmadinejad] has to reach out and to try to interface with other players around him and try to position himself. Now, the best way to do it is to try to use such a meeting and position himself in an agreeable format,” Johannes Benigni, managing director at JBC Energy in Vienna, told CNBC.com.

“Of course the question is, is this what he’s going to do? Is he going to come here and position himself as a moderate leader, or is he going to come here and use this in order to position himself in a more radical format. That’s something we’re all interested to see.”